Another reason to watch AUD/JPY

The Australian Dollar compared to the Japanese Yen is one of my favourite ‘risk appetite’ indicator.

The chart below shows it mirroring the CRB (commodities) Index.

The Yen is at its weakest point against the AUD in 7 years.

Against the U.S. Dollar, the last time the Yen that this week was 20 years ago.

And then the CRB is its highest level in 11 years.

Now, I’ll watch for a change in trend, a crossing of moving averages and break of support lines in the AUD/JPY.

If this occurs, then my thinking that inflation will abate and a retracement in recently hot commodities markets should follow.

June 10, 2022

by Rob Zdravevski

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